Golden Minerals Company ("Golden Minerals," "Golden" or the "Company") (NYSE-A: AUMN and TSX: AUMN) has today released financial results and a business summary for the quarter ending September 30, 2023. (All figures are in approximate U.S. dollars.)
Third Quarter Business Summary and Subsequent Events
Third Quarter Financial Summary
Cash Inflows and Expenditures
Cash expenditures during the nine months ended September 30, 2023 totaled $8.6 million and included:
The above expenditures were offset by cash inflows of $6.2 million from the following:
Capital Resources and 12-Month Financial Outlook
At September 30, 2023, the Company had current assets of approximately $5.9 million, including cash and cash equivalents of approximately $1.6 million. On the same date, it had accounts payable and other current liabilities of approximately $5.6 million. Because the Company has ceased mining at the Rodeo mine, its only near-term opportunity to generate cash flow from mining to support continued operations is the Velardeña mine.
On November 8, 2023, the Company closed the November 2023 Offering which raised gross proceeds of $4.2 million and net proceeds of approximately $3.8 million after expenses. These funds were anticipated in the Company's forecast. The Company's forecast for the twelve-month period ending September 30, 2024 also projects the receipt of additional capital inflows of $3.0 to $4.5 million. In order to commence and maintain production at Velardeña, the Company expects to spend approximately $3.0 to $3.5 over the first five months of production primarily for additional underground development, which is included in the capital forecast discussed above. The actual amount of additional capital required during the twelve-month period ending September 30, 2024 may vary significantly from the amounts specified above and will depend on a number of factors, including variations in the anticipated administrative costs, costs to restart Velardeña, costs at El Quevar, and costs for continued exploration, project assessment, and advancement of its other exploration properties. Assuming that the Company is successful in restarting production and that it meets its production objectives at the Velardeña Properties, cash flow from Velardeña is expected to be positive by the end of the second quarter of 2024. The additional capital required may take the form of non-core asset sales (such as the one described below), debt financing, production-based financing (such as streaming or royalty financing), collection of outstanding VAT receivable, or otherwise. After the November 2023 Offering, the Company's available shares authorized but not issued or outstanding is approximately 2.2 million shares. Should the Company desire to make future stock offerings of more than 2.2 million shares, the number of authorized shares will need to be increased which will require shareholder approval.
With regards to the sale of non-core assets, Golden executed a non-binding letter of intent for the sale of its Santa Maria property for a total consideration consisting of (i) initial cash proceeds of $1.5 million (plus an additional $0.24 million in VAT payment that the Company can retain) and (2) a 1.5% net smelter return royalty on the Santa Maria concession up to a cap of $1.0 million (which may be purchased by the potential buyer from Golden for $0.5 million at any time prior to the commencement of commercial production on the Santa Maria property). If that transaction is consummated, the funds would likely be received in November 2023 or later.
Golden Minerals has also held discussions with various financing parties with regard to equity and/or debt financing as well as streaming or royalty arrangements involving future production at Velardeña.
Quarterly Report on Form 10-Q
The Company's consolidated financial statements and management's discussion and analysis, as well as other important disclosures, may be found in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2023. This Form 10-Q is available on the Company's website at Golden Minerals Company - SEC Filings. It has also been filed with the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov/edgar and with the Canadian securities regulatory authorities on SEDAR at www.sedar.com.
About Golden Minerals
Golden Minerals is a gold and silver producer based in Golden, Colorado. The Company is primarily focused on advancing its Velardeña and Yoquivo properties in Mexico and, through partner-funded exploration, its El Quevar silver property in Argentina, as well as acquiring and advancing selected mining properties in Mexico, Nevada and Argentina.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation, such as statements regarding (i) the Velardeña Properties, including plans and preparation for restarting production at the properties, estimated NPV and mine life, cash flow from the properties, additional capital requirements to restart production on the properties in the form of non-core asset sales, debt financing, production-based financing and/or collection of outstanding VAT receivable, expected expenditures over the first five months of production on the properties for additional underground development and discussions with various financing parties with regard to equity and/or debt financing as well as streaming or royalty arrangements involving future production at the properties; (ii) settlement of the Unifin dispute; (iii) projected receipt of additional capital during the twelve-month period ending September 30, 2024; (iv) increase in the authorized shares of the Company should the Company decide to make a future stock offering; and (v) the potential sale of the Company's Santa Maria property. These statements are subject to risks and uncertainties, including increases in costs and declines in general economic conditions; changes in current payable terms for gold-bearing pyrite concentrates; changes in political conditions, in tax, royalty, environmental and other laws in Mexico and other market conditions; unanticipated variations in grade; challenges associated with our proposed mining plans, including difficulties in controlling grade dilution and interruptions in mining; variations in the anticipated administrative costs, costs to restart Velardeña, costs at El Quevar, and costs for continued exploration, project assessment, and advancement of the Company's other exploration properties, or an adverse result in the pending lawsuit with Unifin Financiera, S.A.B. de C.V. Golden Minerals assumes no obligation to update this information. Additional risks relating to Golden Minerals may be found in the periodic and current reports filed with the Securities & Exchange Commission by Golden Minerals, including the Company's Annual Report on Form 10-K for the year ended December 31, 2022.
For additional information, please visit http://www.goldenminerals.com/ or contact:
Golden Minerals Company
Karen Winkler, Director of Investor Relations
These press releases may also interest you